The start of a new year is a great time for employers to look ahead for changes in the law that will affect their organizations. In this blog post, we will lay out some of the key issues that employers can expect to encounter in the year ahead.
- Exempt Salary Increases: On January 1, 2020, the Department of Labor’s updated “white collar” overtime exemption rule went into effect, increasing the minimum salary level for overtime exemption to $684 per week, or $35,568 per year. In addition, some states have minimum exempt salary levels that exceed the federal threshold. California, New York, Colorado, Maine, and Alaska are raising their state minimum threshold this year.
- Minimum Wage Increases: While Congress still has not enacted a federal minimum wage increase, states and localities across the country continue to implement new minimum wages in 2020. For example, the minimum wage is now $13/hour for California employers with 25 employees or more (and higher in some California cities); in New York City, the new minimum wage is $15/hour for employers with 11 employees or more.
- Independent Contractors: Independent contractor classification continues to be a hot topic in employment law across the country, with many states adopting the stringent “ABC Test” for independent contractors.
- Arbitration Agreements: Mandatory arbitration agreements are also seeing new challenges: California’s new law banning arbitration agreements in the employment setting was put on hold by a court at the last minute, but we can expect to see further developments in California and other states in the new year.
- Discrimination Laws: New discrimination and harassment laws targeting discrimination based on hairstyle (California), pregnancy (Oregon), and other characteristics will go into effect this year as well.
- Pay Equity: New laws in New York and New Jersey both go into effect in January 2020 that will prohibit employers from asking job candidates about their salary history. Other states (Washington state, Alabama, Maine, and Illinois) passed similar legislation last year, and more (Colorado, Georgia, Pennsylvania, and South Carolina) are looking to follow suit soon.
- Training Requirements: A variety of states, including New York, Delaware and Maine have already adopted sexual harassment training requirements, and others have adopted new sexual harassment training requirements with deadlines in 2020. In particular, Illinois’ new law requiring most employers to complete annual training went into effect January 1, 2020, and Connecticut now requires employers with three or more employees to provide sexual harassment training to all employees by October 1, 2020. California requires sexual harassment training for all employers but has extended the time for employers with five or more employees to provide training to January 1, 2021.
- Leave Laws: States and localities continue to pass generous paid family and medical leave laws. Eligible employees in Washington state will soon be entitled to take up to 18 weeks of paid family and medical leave per year. The District of Columbia is set to follow suit later this year. California, Connecticut, Massachusetts, New Jersey, New York, Oregon, and Rhode Island also have paid family leave laws.
- Marijuana and the Workplace: New Mexico and Oklahoma have become the latest to pass legislation prohibiting employers from discriminating against employees because of their status as registered marijuana users; and Nevada and New Jersey each have new laws preventing discrimination based on marijuana use. Meanwhile, New York City has passed an ordinance preventing most employers from conducting any pre-employment testing for marijuana or THC.
- Extra Payday Year: 2020 will be a 27-payday year for some organizations. Employers who pay bi-weekly on Fridays and had a payday on January 3, 2020, will have 27 paydays this year instead of the standard 26. 27-payday years occur once every 11 or 12 years for all bi-weekly payrolls, when the one-or two-day shortage of the standard 26 payday shortage catches up, causing a 27th payday to fall within the same calendar year. Employers with a 27th payday in their 2020 calendar should plan for how the extra payday will impact payroll deductions for health benefits, flexible spending accounts, and the cash flow impact the extra payday will have on their year.
Be sure to subscribe to HR Law Matters to stay up to date on these and other employment developments in the new year. As always, if you have any questions about the new developments in employment law and how they affect your organization, Troutman Sanders’ labor and employment attorneys are happy to assist you. Happy New Year!